Case Study: iPod to IPad: innovation and entrepreneurship at Apple
Q1)What are the market segments indentified by Apple and their relevance over the years?
Apple identified four key segments within the market:
-Business,
-Creative Professionals,
-Education ,
-High end cosumers
In 2000, 75% of the sales were to the traditional business and professional markets.
The first ipod was launched in 2001 later followed by a 10 GB version. In 2003, the ITunes
Music Store opened. Access to music and downloads became easier. By 2009, the situation had reversed with 60% of sales in the consumer markets of education, students and the broader consumer market. The search for consumer product in 2001 was the cause of this dramatic turn around.
Prior to the launch of Ipod, Apple wanted to enter the market for consumer digital devices.
They found the market for Digital MP3 players was relatively under developed with no big players involved and significant design flaws in the products on offer. Apple chose music on the move since the market potential was huge and no one had got the right recipe. Price was no barrier to Apple. By tradition the company tended to follow a premium price entry model.
They understood that the Key success factors in the market were design, size, capacity, battery life, software and download facility.
Apple were looking for creative professionals to satisfy the above criteria and seized the opportunity to hire Fadell who had ideas for a brand new MP3 player which matched Apple’s idea. Steve-Jobs had hands-on experience with the product design team at every stage.The development stages were simultaneous and organic. Apple educated the consumers on the emphasis of simplicity and reliability. Apple provided high power computing performance and high service levels with attracted enterprise, government and the creative sectors.
By 2008,